FBR allows filer rate tax for overseas Pakistanis on property deals, even if non-filers

ISLAMABAD: The Federal Board of Revenue (FBR) has clarified that overseas Pakistanis can avail the lower, filer-level advance income tax rate on buying or selling property in Pakistan, even if they are technically classified as non-filers. 

According to Business Recorder, in a set of newly issued FAQs, the FBR said that the filer rate under Sections 236C and 236K of the Income Tax Ordinance will apply to overseas Pakistanis, provided they meet two key conditions: they must hold a Pakistan Origin Card (POC) or National Identity Card for Overseas Pakistanis (NICOP), and they must be non-resident, meaning their stay in Pakistan during a financial year is less than 183 days.

Typically, the advance tax collected at the time of a property transaction varies based on the market value of the property and whether the buyer or seller is a filer, late filer, or non-filer. Non-filers are usually charged a significantly higher rate. 

However, under the new clarification, overseas Pakistanis meeting the residency and identification criteria can access the same lower rates available to registered filers. 

To claim the reduced tax rate, the relevant authority responsible for registering or transferring the property, such as a registrar or housing society, must select the “Overseas Pakistanis” option on the FBR web portal to generate a Payment Slip ID (PSID). 

The applicant will then be redirected to form requiring NICOP number, which will auto-populate their personal details. They will also need to upload a scanned copy of their ID and documents supporting their non-resident status.  

The PSID is digitally sent to the concerned tax commissioner’s IRIS inbox for review. Once verified and approved, the applicant is notified via email and SMS and can proceed to pay the advance income tax at the filer rate, regardless of their non-filer status. 

The FBR said the move is aimed at facilitating overseas Pakistanis and simplifying the property transaction process for them. 

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